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respect to decedent's Agri stock and Agri-Bank preferred stock8
(1991 Agreement).
According to its preamble, the 1991 Agreement's purpose was
to restrict the transferability of decedent's shares and provide
for their purchase by Agri upon the occurrence of certain events
(including decedent's death), as well as to ensure that, in the
event a controlling interest in Agri were sold, decedent would
receive the same consideration per share for her minority
interest as Mr. Hill received for the sale of his controlling
interest.
In specific terms, the 1991 Agreement prohibited decedent
from transferring her Agri stock9 without (i) having obtained the
consent of Agri and Mr. Hill, or (ii) having offered to sell the
stock to Agri at the price contained in any bona fide third-party
offer. Under the 1991 Agreement, the conservatorship received
put options whereby the conservator could require Agri to
purchase all of decedent's Agri common stock for book value, and
all of decedent's Agri preferred stock for par plus unpaid
dividends. Agri likewise received call options, exercisable
8 Decedent's 13,377 shares of Agri-Bank preferred stock were
not exchanged, Agri-Bank having survived the exchange as a
subsidiary of Agri.
9 An exception was made for transfers to decedent's lineal
descendants and their spouses, who would be bound by the 1991
Agreement.
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Last modified: May 25, 2011